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II
Calendar No. 132
116TH CONGRESS
1ST SESSION
S. 1416
To amend the Federal Trade Commission Act to prohibit anticompetitive
behaviors by drug product manufacturers, and for other purposes.
IN THE SENATE OF THE UNITED STATES
MAY 9, 2019
Mr. CORNYN (for himself, Mr. BLUMENTHAL, Mrs. CAPITO, Mrs. MURRAY,
Mr. SCOTT of Florida, Mr. KENNEDY, Mr. HAWLEY, and Mr. DURBIN)
introduced the following bill; which was read twice and referred to the
Committee on the Judiciary
JUNE 28 (legislative day, JUNE 27), 2019
Reported by Mr. GRAHAM, with an amendment
[Strike out all after the enacting clause and insert the part printed in italic]
A BILL
To amend the Federal Trade Commission Act to prohibit
anticompetitive behaviors by drug product manufactur-
ers, and for other purposes.
Be it enacted by the Senate and House of Representa-
1
tives of the United States of America in Congress assembled,
2
SECTION 1. SHORT TITLE.
3
This Act may be cited as the ‘‘Affordable Prescrip-
4
tions for Patients Act of 2019’’.
5
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SEC. 2. PRODUCT HOPPING; PATENT THICKETING.
1
(a) IN GENERAL.—The Federal Trade Commission
2
Act (15 U.S.C. 41 et seq.) is amended by inserting after
3
section 26 (15 U.S.C. 57c–2) the following:
4
‘‘SEC. 27. PRODUCT HOPPING; PATENT THICKETING.
5
‘‘(a) DEFINITIONS.—In this section:
6
‘‘(1) ABBREVIATED NEW DRUG APPLICATION.—
7
The term ‘abbreviated new drug application’ means
8
an application under subsection (b)(2) or (j) of sec-
9
tion 505 of the Federal Food, Drug, and Cosmetic
10
Act (21 U.S.C. 355).
11
‘‘(2) BIOSIMILAR BIOLOGICAL PRODUCT.—The
12
term ‘biosimilar biological product’ means a biologi-
13
cal product licensed under section 351(k) of the
14
Public Health Service Act (42 U.S.C. 262(k)).
15
‘‘(3)
BIOSIMILAR
BIOLOGICAL
PRODUCT
LI-
16
CENSE APPLICATION.—The term ‘biosimilar biologi-
17
cal product license application’ means an application
18
submitted under section 351(k) of the Public Health
19
Service Act (42 U.S.C. 262(k)).
20
‘‘(4) COMPETITION WINDOW.—The term ‘com-
21
petition window’ means—
22
‘‘(A) with respect to a listed drug, the pe-
23
riod between—
24
‘‘(i) the date that is the earlier of—
25
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‘‘(I) 8 years before any patent or
1
marketing exclusivity granted under
2
chapter V of the Federal Food, Drug,
3
and Cosmetic Act (21 U.S.C. 351 et
4
seq.) with respect to such listed drug
5
expires; and
6
‘‘(II) the date on which the first
7
abbreviated new drug application that
8
references such listed drug is filed;
9
and
10
‘‘(ii) the later of—
11
‘‘(I) the date that is 180 days
12
after the first abbreviated new drug
13
application that references such listed
14
drug is filed; and
15
‘‘(II) the date that is 1 year after
16
the date on which the generic drug
17
that is the subject of the abbreviated
18
new drug application described in sub-
19
clause (I) enters the marketplace; or
20
‘‘(B) with respect to a reference product,
21
the period between—
22
‘‘(i) the date that is the earlier of—
23
‘‘(I) 6 years before any patent or
24
marketing exclusivity (including any
25
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extension of such exclusivity) granted
1
under
section
351
of
the
Public
2
Health Service Act (42 U.S.C. 262)
3
or section 527 of the Federal Food,
4
Drug, and Cosmetic Act (21 U.S.C.
5
360cc) with respect to such reference
6
product expires; and
7
‘‘(II) the date on which the first
8
biosimilar biological product license
9
application that references such ref-
10
erence product is filed; and
11
‘‘(ii) the later of—
12
‘‘(I) the date that is 180 days
13
after the date on which the first bio-
14
similar biological product license ap-
15
plication
that
references
such
ref-
16
erence
product
enters
the
market-
17
place; and
18
‘‘(II) the date that is 1 year after
19
the date on which the biosimilar bio-
20
logical product that is the subject of
21
the biosimilar biological product li-
22
cense application described in sub-
23
clause (I) enters the marketplace.
24
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‘‘(5)
EXPECTED
REVENUE.—The
term
‘ex-
1
pected revenue’, with respect to a follow-on product,
2
means the financial value represented by the number
3
of individuals in the target population multiplied by
4
the financial revenue generated by each member of
5
the target population over the 3-year period begin-
6
ning—
7
‘‘(A) on the day that 3 generic drugs ref-
8
erencing the same listed drug or 2 or more bio-
9
similar biological products referencing the same
10
reference product would have been widely avail-
11
able in the market; or
12
‘‘(B) if 3 or more generic drugs ref-
13
erencing the same listed drug or 2 or more bio-
14
similar biological products referencing the same
15
reference product are already widely available in
16
the market, the day that the follow-on product
17
enters the market.
18
‘‘(6) FOLLOW-ON PRODUCT.—The term ‘follow-
19
on product’ means a drug approved through an ap-
20
plication or supplement to an application submitted
21
under section 505(b) of the Federal Food, Drug,
22
and Cosmetic Act (21 U.S.C. 355(c)) or a biological
23
product licensed through an application or supple-
24
ment to an application submitted under section
25
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351(a) of the Public Health Service Act (42 U.S.C.
1
262(a)) for a change, modification, or reformulation
2
to the same manufacturer’s previously approved
3
drug or biological product.
4
‘‘(7) GENERIC DRUG.—The term ‘generic drug’
5
means a drug approved under subsection (b)(2) or
6
(j) of section 505 of the Federal Food, Drug, and
7
Cosmetic Act (21 U.S.C. 355).
8
‘‘(8) LISTED
DRUG.—The term ‘listed drug’
9
means a drug listed under section 505(j)(7) of the
10
Federal Food, Drug, and Cosmetic Act (21 U.S.C.
11
355(j)(7)).
12
‘‘(9) PATENT FAMILY.—The term ‘patent fam-
13
ily’ means a group of related patents that continue
14
the priority date of the underlying composition of
15
matter patent, all of which claim the same drug or
16
biological product or a use of the same drug or bio-
17
logical product.
18
‘‘(10) PATENT PORTFOLIO.—The term ‘patent
19
portfolio’ means a group of related patents covering
20
the same or similar technical content.
21
‘‘(11) PATENT THICKETING.—
22
‘‘(A)
IN
GENERAL.—The
term
‘patent
23
thicketing’ means an action taken to limit com-
24
petition by a patentee with respect to a drug
25
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approved under section 505(c) of the Federal
1
Food, Drug, and Cosmetic Act (21 U.S.C.
2
355(c)) or a biological product licensed under
3
section 351(a) of the Public Health Service Act
4
(42 U.S.C. 262(a)) in which—
5
‘‘(i)(I) the patentee obtains patents in
6
the same patent family or patent port-
7
folio—
8
‘‘(aa) that claim the drug or bio-
9
logical product or a use of the drug or
10
biological product, a form of the drug
11
or biological product, a method of use
12
of the drug or biological product, or a
13
method of manufacture of a drug or
14
biological product; and
15
‘‘(bb) whose effective filing date
16
does not precede the date of filing the
17
application under section 505(b) of
18
the Federal Food, Drug, and Cos-
19
metic Act (21 U.S.C. 355(b)) or sec-
20
tion 351(a) of the Public Health Serv-
21
ice Act (42 U.S.C. 262(a)); or
22
‘‘(II) the underlying composition of
23
matter patent is found invalid and the pat-
24
entee obtains patents in the same patent
25
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family or patent portfolio that claim the
1
drug or biological product or a use of the
2
drug or biological product, a form of the
3
drug or biological product, a method of use
4
of the drug or biological product, or a
5
method of manufacture of the drug or bio-
6
logical product;
7
‘‘(ii) an abbreviated new drug applica-
8
tion referencing such approved drug or a
9
biosimilar biological product license appli-
10
cation referencing such licensed biological
11
product could not be marketed without
12
practicing one or more of the inventions
13
claimed in the additional patents described
14
in subclause (I) or (II) of clause (i); and
15
‘‘(iii) the Commission determines that
16
the patentee improperly limited competi-
17
tion by obtaining patents described in sub-
18
clause (I) or (II) of clause (i).
19
‘‘(B) FACTORS TO CONSIDER.—The Com-
20
mission may establish that an action described
21
in subparagraph (A) improperly limits competi-
22
tion if the Commission establishes a reasonable
23
number of the following factors in a manner
24
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that is sufficient to demonstrate anticompetitive
1
intent:
2
‘‘(i) The additional patents described
3
in subparagraph (A)(i) (referred to in this
4
subparagraph as the ‘additional patents’)
5
stem from few patent families.
6
‘‘(ii) The additional patents have com-
7
mon specifications.
8
‘‘(iii) The additional patents did not
9
issue on an application with respect to
10
which a requirement for restriction under
11
section 121 of title 35, United States
12
Code, has been made, or on an application
13
filed as a result of such a requirement.
14
‘‘(iv)
The
additional
patents
have
15
overlapping or identical claims.
16
‘‘(v) The additional patents have been
17
granted to the patentee on formulations or
18
compositions of the product and not used.
19
‘‘(vi) One or more of the additional
20
patents have been invalidated in an inter
21
partes review conducted under chapter 31
22
of title 35, United States Code, or a post-
23
grant proceeding conducted under chapter
24
32 of that title.
25
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‘‘(vii) Litigation with applicants under
1
section 351(k) of the Public Health Service
2
Act has been extended based on the addi-
3
tional patents.
4
‘‘(viii) The applications with respect
5
to the additional patents described in sub-
6
clause (I) or (II) of subparagraph (A)(i)
7
are submitted not more than 36 months
8
before the expiration of the underlying
9
composition of matter patent.
10
‘‘(ix) A public or internal statement, a
11
shareholder call, or another demonstration
12
of purpose that the patentee intended to
13
use the number of patents or length of ex-
14
tended patent protection in order to unduly
15
limit competition.
16
‘‘(12) REFERENCE PRODUCT.—The term ‘ref-
17
erence product’ has the meaning given the term in
18
section 351(i) of the Public Health Service Act (42
19
U.S.C. 262(i)).
20
‘‘(13) TARGET POPULATION.—The term ‘target
21
population’, with respect to a drug, means the popu-
22
lation of individuals that—
23
‘‘(A) would experience a significant health
24
improvement from a follow-on product; and
25
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‘‘(B)
would
have
bought
the
follow-on
1
product solely because of the significant health
2
improvement that those individuals would expe-
3
rience.
4
‘‘(14) ULTIMATE PARENT ENTITY.—The term
5
‘ultimate parent entity’ has the meaning given the
6
term in section 801.1 of title 16, Code of Federal
7
Regulations, or any successor regulation.
8
‘‘(15) UNDERLYING COMPOSITION OF MATTER
9
PATENT.—The term ‘underlying composition of mat-
10
ter patent’ means a patent with respect to the mol-
11
ecules, compounds, or new formulations of the active
12
ingredient of a drug or biological product.
13
‘‘(b) PROHIBITIONS.—
14
‘‘(1) PATENT THICKETING.—
15
‘‘(A) PRIMA FACIE.—Except as provided in
16
subparagraph (B), an action by a drug manu-
17
facturer that constitutes patent thicketing shall
18
be considered to be an unfair method of com-
19
petition in or affecting commerce in violation of
20
section 5(a).
21
‘‘(B) REBUTTAL.—
22
‘‘(i) IN
GENERAL.—Subject to sub-
23
paragraph (C), an action that constitutes
24
patent thicketing shall not be considered to
25
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be an unfair method of competition in or
1
affecting commerce in violation of section
2
5(a) if the manufacturer described in that
3
paragraph demonstrates to the Commis-
4
sion or a district court of the United
5
States, as applicable, by a preponderance
6
of the evidence in a proceeding initiated by
7
the
Commission
under
subsection
8
(c)(1)(A), or in a suit brought under sub-
9
paragraph (B) or (C) of subsection (c)(1),
10
that the anticompetitive effects of the ac-
11
tion do not outweigh the pro-competitive
12
effects of the action.
13
‘‘(ii) EVIDENCE.—In making a dem-
14
onstration under clause (i) that the anti-
15
competitive effects of patent thicketing do
16
not outweigh the pro-competitive effects of
17
that behavior, a manufacturer described in
18
subparagraph (A)—
19
‘‘(I) may present evidence that—
20
‘‘(aa) the inventions claimed
21
in
the
additional
patents
de-
22
scribed in subclauses (I) and (II)
23
of
subsection
(a)(11)(A)(i)
re-
24
sulted in—
25
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‘‘(AA) clinically mean-
1
ingful and significant thera-
2
peutic or safety benefits;
3
‘‘(BB) significantly im-
4
proved product purity or po-
5
tency;
6
‘‘(CC)
significant
7
gained efficiencies in manu-
8
facturing; or
9
‘‘(DD) other improved
10
product
attributes
having
11
substantial benefits for con-
12
sumers or patients;
13
‘‘(bb) a generic drug or bio-
14
similar biological product could
15
be marketed commercially with-
16
out incorporating the improve-
17
ments
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